Financial Knowledge is paramount to the very
living of a human being. No matter, what
profession or career one enters, end of the day, they all receive
compensation. Neglecting the importance
of Finance is a quick recipe for disaster.
But, unfortunately, Financial Knowledge is the most misunderstood or
ignored aspect of life, by many. Many of
them self-certify their Financial Knowledge thereby locking their minds from
learning further on this.
The financial requirement and approach for
everyone may vary but the fundamentals remain the same. Acquiring Financial knowledge at a young age
helps an individual gain confidence in making financial decisions and in
handling personal finance. So, the first
lesson is to get exposed to finance at a young age.
More often, the Parents do not allow their
Children to handle finance at a young age.
The fear of misuse is one of the primary reasons among many others. No Parent would like to see their hard-earned
money being mishandled by their children or subjected to losses by Children due
to cheating incidences or loss of Cash due to carelessness. But for how long can this continue. In most cases, the Parents keep track of
their Children’s finances, until their Children get married. This is the first fundamental mistake
committed by many.
No one has learnt how to ride a bicycle without
falling. Similarly, no one has led a
life without being cheated Financially.
No one has led a life without having lost Cash due to theft or
carelessness. This is the rule of the
land. Nothing in this world comes
free. One must spend to learn anything
in this world. If one gets cheated, he
surely learns a lesson. The cost of the
lesson is the amount that is lost due to cheating.
The attitude and tolerance of Parents play a major
role in establishing the Financial discipline in their Children. In most middle-class families, the children
get access to money when they start going to College. Especially, the children staying in Hostel
get access to a large chunk. In a high
majority of cases, the parents always keep a tag on such wards and ask their
children on how and where they spend the Money.
Keeping a check on their spending is different from creating an
environment where they learn the importance of money and take up the responsibility.
If you trust your children, do not
suspect. If you suspect, do not
Trust. If you do not trust your children
who else will Trust. It is always better
to let them handle their finance at a young age by allowing them to take
smaller decisions when you are still in service and can afford smaller
losses. When you are around, you can
guide them properly and that too before they start earning themselves. It will be dangerous if you protect your
Children and start handling their finances till, they start earning on their
own or till they get married. When they
are free to take financial decisions, they would not have gained any financial
knowledge as they were always under the umbrella of their Parent.
One can come across dialogues in many families
where the Father tells his son that it is his hard-earned money and he has no
problem if the Child squanders money earned on their own. How logical is this? Money is still money. It does not matter if it is earned by the
Parent or their Children. This attitude
from such parents need to change.
When the child comes into the Employment
Market, he should have understood the value of money and the importance of
it. The Children should know the
difference between Spending and Using money.
This is the responsibility of the Parent. The parents, by involving their Children in
decision making can make their Children understand the difference between
Spending Money and Using Money. One
cannot protect their child for long.
Letting one’s children handle their own Finances without any prior
experience or knowledge will only do harm to the earnings of the Child.
The parents need to be more tolerant. They should accept the financial mistakes of
their Child and stand by the Child in correcting the mistakes. The parent’s guidance is very important and
such guidance will be effective and understood properly by the Children when
they are young. One should not expect
their children to listen to them on financial matters, when their children have
started earning on their own.
Exposure to finance matters and involvement of
Children in decision making at a younger age will help the child understand the
value and importance of Finance and learn the difference between using the
money and spending the money at a early stage.
This will ensure the Child handles his finance wisely when he starts to
make his own living.
Involve your children while you take Financial
Decisions and expose them to the real world, early, for their benefit.
(The above article was written for publication in May 2019 issue of PRINCE'S VOICE - my Community eMagazine.)
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